A ground-level look at the categories being launched across Indian AMCs this quarter, and what the composition of the pipeline says about the industry’s direction.
For an industry that had built its launch calendar around a steady flow of thematic and sectoral equity schemes, 2026 has been a year of quiet reinvention. The overall NFO pipeline has thinned meaningfully, but the composition of what is being launched has widened in an interesting way. For investors trying to make sense of the alphabet soup of new offerings, the categories in play are worth understanding on their own terms.
Index Funds and ETFs: The Steady Draw
Passive launches have emerged as the workhorse of the 2026 NFO calendar. Index funds tracking differentiated benchmarks — the Nifty Bank, Sensex, MSCI India, Nifty Midcap 150, Smallcap 250, and various strategy indices such as low volatility, quality, and momentum — have been the most consistent category by number of launches. Passive AUM in the industry has climbed from around 14 per cent in May 2022 to roughly 18 per cent in May 2026, reflecting a steady structural shift.
ETFs have seen a parallel push, though the category comes with its own quirks. Bid-ask spreads on newly-launched thematic ETFs tend to be wide in the early months, which affects the actual price at which investors can buy or sell units on exchanges. Broader index ETFs — Nifty 50, Sensex, and Bank Nifty — carry cleaner liquidity from launch.
Fund of Funds: The Repackaging Question
FoF launches have been a steady but debated category. Domestic FoFs investing in international indices — S&P 500, Nasdaq 100, MSCI Emerging Markets — have seen selective interest, particularly from investors seeking geographic diversification. Domestic FoFs that invest in ETFs launched by the same AMC have drawn some scrutiny from industry watchers, who note that the layered fee structure needs careful evaluation.
Under SEBI’s revised expense framework effective April 2026, equity-oriented FoFs face a lower cap of 2.10 per cent, down from 2.25 per cent. Liquid FoFs face a 0.90 per cent cap. Costs are visibly tighter than they used to be, which changes the value proposition.
Specialised Investment Funds: The New Category
SIFs, cleared under a SEBI framework in 2025, are now well into their launch cycle. ICICI Prudential, Edelweiss, 360 ONE, and Nippon India are among the AMCs with active or recently-launched SIF schemes. The category has a Rs 10 lakh minimum investment threshold, which keeps it firmly targeted at HNI and affluent investors. Long-short equity, active asset allocation, and Ex-Top-100 strategies dominate the launched schemes so far.
The category is too young to judge on performance. What is visible is that SIF launches have gathered assets more slowly than mutual fund NFOs of comparable positioning in prior cycles, reflecting both the higher minimum and the more evaluative nature of the target investor.
Hybrid and Multi-Asset: Quiet Winners
Multi-asset allocation and balanced hybrid launches have drawn steady subscriptions through 2026. The category benefits from a market environment where no single asset class has dominated, and where investors are seeking one-product exposure to equity, debt, and gold. Multi-asset AUM has grown at double-digit rates over the past year, and new launches have gathered respectable books.
What’s Not Being Launched
The visible absence in the 2026 calendar is active sectoral and thematic equity schemes. For the first quarter of FY27, no new launches occurred in this category — a pattern not seen in nearly five years. SEBI’s tightened categorisation rules, capping portfolio overlap between thematic schemes and other equity funds at 50 per cent, have raised the design bar. Fund houses appear to have paused thematic development while they rework product frameworks.
The NFO calendar of 2026 looks less crowded, but it also looks more purposeful. For investors reading through a scheme information document, the questions to ask have grown sharper: what does the fund actually do, who is managing it, what does it cost, and does it fill a gap in the portfolio. Those are the right questions, and the industry appears to be preparing for a decade in which those are the only questions that will consistently pay off for AMCs.